Canpotex makes potash sale to China

The organization that markets potash for three Saskatchewan producers has announced a big sale to China.

Canpotex said Monday it has reached an agreement with Sinofert, China's largest fertilizer enterprise, to sell 350,000 tonnes of Canadian potash.

The product is to be shipped to China before the end of March. Canpotex said the potash is being sold "at competitive prices" but didn't disclose a specific number.

Although the potash industry had been in the doldrums for much of 2009, Canpotex said Monday the overseas potash market is now "much-improved."

Ifso, that'sa welcomedevelopment for the Saskatchewan government, which expected potash revenues to account for one-fifth of its budget last spring before the market went into a tailspin.

In November, the province said it calculated potash would bring about $100 million into the treasury for the year, $1.8 billion less than was originally budgeted in March.

Monday's potash sale is good news both monetarily and psychologically, Saskatchewan Energy Minister Bill Boyd said.

Boyd, who returned home from Asia on Sunday, said his recent visit to China may have even sparked the deal, which he saidpredicted would"kickstart" the market.

"Certainly it was good to see," Boyd said. "Following the premier asking us to embark upon discussions with Sinofert and see if we couldn't somehow or another kickstart negotiations, we were pleased to see that that happened."

The government of Saskatchewan simply reaffirmed to China that if it wants to buy potash, it must negotiate with Canpotex, Boyd said.

After Boyd did that, negotiations between China and Canpotex began the next day, he said.

Canpotex is the marketing company owned by three Saskatchewan potash-producing companies: Potash Corp., Mosaic and Agrium Inc.